Why some people would have two insurance policies on the same car sounds confusing, and it is. Confusing as it may be, it does happen. Some people who co-own a vehicle choose to each take out separate insurance on the same car so that all the responsibility can be equally shared. But that may cause more problems than it solves.
So, what do the states think about this arrangement? Many states require you to provide proof of insurance to the state when you buy your car, after that your insurance company notifies the state whenever you renew your policy or allow it to lapse. Once this information is in the states data base, it can be accessed by a police officer should you get into an accident. Where it is not illegal to have double coverage, most states frown upon the practice. The fact that the same VIN is registered on two different insurance policies can raise a red flag and cause the state to notify the insurance companies.
As far as the insurance companies are concerned, they do not like double coverage either. It’s a simple matter of avoiding all the confusion it can lead to. When you have one insurance policy, the process is simple when it comes time to file a claim. When you have double coverage, things can get a lot more confusing. There are a multitude of situations and conditions where the question of who’s insurance should address the problem becomes difficult to decide.
When you have double coverage, there is also a risk of violating your insurance companies’ policies. You may outright violate a clause in your policy, or your insurance company may see you as trying to enrich yourself. If this were to happen it could lead to both insurance companies refusing to pay, or even a cancelation.
So, it seems that even though it is legal to carry two insurance policies on the same vehicle, it’s just not that great of an idea. Save yourself the headache and do it the old-fashioned way with one policy.